EXHIBIT 2.1
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SHARE PURCHASE AGREEMENT
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This Share Purchase Agreement (the "Agreement") is entered into as of May
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23, 1997 by and among Aseco Corporation, a Delaware corporation (the
"Purchaser"), the parties listed on Exhibit A-I hereto (the "Principal Sellers")
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and the parties listed on Exhibit A-II hereto (the "Other Sellers"). The
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Principal Sellers and the Other Sellers are sometimes individually referred to
herein as a "Seller" and, collectively as the "Sellers". 3i Group Plc, Gran
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Nominees Ltd. and Devon Enterprise Fund are referred to herein as the
"Institutional Sellers". Each Seller who is not as Institutional Seller is
referred to herein as an "Individual Seller".
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Recitals
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WHEREAS, the Sellers own the entire share capital (the "Shares") of Western
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Equipment Developments (Holdings) Limited, a company incorporated under the laws
of England (the "Company"); and
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WHEREAS, upon the terms and conditions set forth herein, the Sellers desire
to sell, and the Purchaser desires to purchase, the Shares;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
PURCHASE AND SALE; CLOSING
Section 1.01. Purchase and Sale of Shares.
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(a) Subject to the terms of this Agreement each Seller shall sell the
number of Shares set out opposite his or its name on Exhibit A-I or A-II (as
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appropriate) and the Purchaser shall purchase such Shares, free from any
mortgage, charge, pledge, lien, option, restriction or other security interest
of any kind, any option or right of first refusal, preemption, forfeiture or
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call, any other right exercisable by a third party, or any other encumbrance
(including encumbrances imposed and rights conferred by or under any enactment)
(collectively, "Encumbrances"). The Shares shall be sold with the benefit of
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all rights which attached thereto at, or which have or will become attached
thereto after, the Balance Sheet Date (as defined below).
(b) Each Seller hereby severally covenants with the Purchaser that such
Seller (i) is the legal owner of the number of Shares set out opposite his or
its respective name on Exhibit A-I or A-II (as appropriate)(ii) has full right,
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power and title to sell such Shares free from all Encumbrances and (iii) will at
his or its own cost and as soon as practicable after Closing do everything
required by the Purchaser to transfer to, and vest in, the Purchaser (or its
nominee) the beneficial and legal ownership of such Shares.
(c) Except as specifically provided herein, the provisions of part 1 of the
Law of Property (Miscellaneous Provisions) Act 1994 shall not apply to this
Agreement.
(d) Any provisions contained in this Agreement which limit or restrict the
remedies of the Purchaser hereunder (including Section 5.02 hereof) shall not
apply to Sections 1.01(a) and (b) above.
(e) The Purchaser shall not be obligated to complete the purchase of any of
the Shares hereunder unless the sale of all of the Shares is completed
simultaneously.
(f) Each Seller hereby irrevocably waives any and all rights of preemption,
first offer and first refusal and all similar rights, if any, that such Seller
may have pursuant to the Company's Memorandum or Articles of Association or
pursuant to applicable laws or pursuant to any other agreement (oral or written)
relating to the Shares, so as to enable the consummation of the transactions
contemplated hereby.
Section 1.02. Purchase Price.
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(a) Amount. The aggregate purchase price to be paid by the Purchaser
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for the Shares (the "Purchase Price") shall be an amount equal to
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(Pounds)3,640,000 less the sum of (i) the amount (the "Debt Adjustment Amount"),
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if any, by which Company Indebtedness
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(as defined below in this Section 1.02(a)) at Closing exceeds (Pounds)400,000
and (ii) the Net Book Value Adjustment Amount (as defined in Section
1.02(c)(iii) below). As used herein, the term "Company Indebtedness" shall mean
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all indebtedness of the Company for borrowed money and under capitalized leases
(including all outstanding principal, accrued interest and any fees and
penalties with respect thereto), and the aggregate amount of all issued but
uncleared or unpresented cheques of the Company ("Outgoing Cheques"), reduced by
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the aggregate exercise price paid in respect of the options to subscribe for
Shares being exercised in conjunction with the Closing. The term "Company
Indebtedness" shall not include trade credit extended in connection with the
provision of goods and services. Company Indebtedness at Closing shall be
determined by reference to (i) a certificate of the officer or director of the
Company principally responsible for the Company's financial and accounting
matters certifying as to the aggregate amount of Outgoing Cheques and (ii) a
certificate of each person or entity to which Company Indebtedness is owed
(other than by virtue of being the payee of an Outgoing Cheque), all of such
certificates to be in a form satisfactory to the Purchaser and delivered to the
Purchaser at Closing. Except as may be otherwise expressly set forth herein, all
references in this Agreement to "(Pounds)" or "pounds" shall mean British pounds
sterling. The sum of (Pounds)3,040,000 shall be apportioned among the Sellers as
shown on Exhibit A-I and Exhibit A-II, and any Debt Adjustment Amount effective
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at Closing shall be borne by the Sellers pro rata based on the number of
ordinary shares or class A ordinary shares each holds at Closing as shown on
Exhibit A-I and Exhibit A-II relative to the total number of issued ordinary
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shares and class A ordinary shares at Closing.
(b) Payment; Escrow Account. Subject to the terms and conditions of
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this Agreement, at the Closing, the sum of (Pounds)3,040,000 minus the Debt
Adjustment Amount, if any (being part of the Purchase Price) (the "Initial
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Amount") shall be paid by wire transfer of immediately available funds to the
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Sellers' solicitors, Burges Salmon of Narrow Quay, Bristol BSI 4AH, England (the
"Sellers' Solicitor"), on behalf of the Sellers, to the account listed on
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Schedule 1.02 hereto and (Pounds)600,000 (being part of the Purchase Price)
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(together with any additions thereto pursuant to Section 5.08 and interest
thereon, the "Escrow Amount") shall be paid by the Purchaser and immediately
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caused to be transferred directly by the Sellers into escrow pursuant to the
terms and conditions of the Escrow Agreement (as defined in
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Section 4.01(e)) to fund the payment of the Total Purchase Price Adjustment
Amount in accordance with Section 1.02(c)(iii) and to secure the indemnification
obligations of the Sellers under this Agreement.
(c) Post-Closing Purchase Price Adjustment.
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(i) As soon as practicable, but not later than sixty (60) days
after the Closing, the Purchaser will determine, and deliver to the
Individual Seller Representatives (as defined in Section 1.06(a)) and the
Institutional Sellers, a written statement of the Net Book Value (as
defined below) based upon a consolidated balance sheet of the Company and
its subsidiaries as of immediately prior to the Closing (the "Closing
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Balance Sheet") prepared by or on behalf of the Purchaser. The Closing
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Balance Sheet shall be prepared in a manner consistent with the Company's
past practices; provided, however, that to the extent of any conflict
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between such past practices and generally accepted accounting practices and
policies accepted in England and Wales ("GAAP"), other than with respect to
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the recorded value of inventory (excluding certain of the inventory
referred to in the Company's management accounts as "engineering stock" or
"demonstration stock" that in accordance with GAAP is properly reclassified
as fixed assets ("Reclassified Fixed Assets")) and accounts receivable,
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GAAP shall prevail and be applied. The recorded value of any Reclassified
Fixed Asset for purposes of the Closing Balance Sheet shall be the
depreciated cost thereof as reflected in the Company's February 28, 1997
management accounts, provided such asset (A) has ongoing utility to the
Company, (B) has been depreciated over a period of no longer than five (5)
years and (C) the initial recorded value of such asset was determined in a
manner consistent with GAAP. The recorded value of any Reclassified Fixed
Asset for purposes of the Closing Balance Sheet which does not satisfy
clauses (A), (B) and (C) of the immediately preceding sentence shall be
determined in accordance with GAAP. "Net Book Value" shall mean the excess
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of the assets of the Company and its subsidiaries on a consolidated basis
(including goodwill of (Pounds)87,098) over the liabilities of the Company
and its subsidiaries on
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a consolidated basis, each as set forth on the Closing Balance Sheet.
(ii) The Individual Seller Representatives and the Institutional
Sellers (or any of them) shall have the right to cause an independent
accounting firm ("Sellers' Accountant") to review the Closing Balance Sheet
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and the determination of Net Book Value. In connection therewith, the
Purchaser shall provide Sellers' Accountant with access to the books,
records, facilities and employees of the Company and shall cooperate with
Sellers' Accountant in the performance of such audit. Within thirty (30)
days of the Individual Seller Representatives' and the Institutional
Sellers' receipt of the Closing Balance Sheet, each of the Individual
Seller Representatives and the Institutional Sellers shall inform the
Purchaser in writing that each such Individual Seller Representative and
Institutional Seller (A) concurs with the Closing Balance Sheet or (B)
disagrees with the Closing Balance Sheet and the determination of Net Book
Value, specifying in reasonable detail the nature of the disagreement. If
the parties and their independent accountants cannot resolve such
disagreement within 15 days of the receipt by the Purchaser of notice of
such disagreement, the Sellers' Accountant and the Purchaser's accountant,
shall jointly appoint a firm of independent accountants to resolve the
disagreement (the "Arbitrating Accountant"). In the event of a
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disagreement as to the appointment of the Arbitrating Accountant, the
Arbitrating Accountant shall be appointed by the then President of the
Institute of Chartered Accountants in England and Wales. The Arbitrating
Accountant will determine the Net Book Value within thirty (30) days
following such appointment and such determination shall be final and
binding on the parties hereto. The cost of the Arbitrating Accountant
shall be shared equally by the Sellers, on the one hand, and the Purchaser
on the other. Any failure by the Individual Seller Representatives and the
Institutional Sellers to object to the Closing Balance Sheet and the
determination of Net Book Value within thirty (30) days of the Individual
Seller Representatives' and the
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Institutional Sellers' receipt thereof shall be deemed, for all purposes
hereof, to be a concurrence therewith.
(iii) Within five days after the earlier of (A) the receipt by
the Purchaser of the Individual Seller Representatives' and the
Institutional Sellers' concurrence with the Closing Balance Sheet and the
determination of the Net Book Value or (B) the final resolution by the
parties or the Arbitrating Accountant, as the case may be, of any
disagreements, the Individual Seller Representatives and the Purchaser
shall jointly cause to be paid to the Purchaser from the Escrow Amount an
amount equal to the sum of (1) the excess, if any, of (Pounds)477,910 over
the Net Book Value (the "Net Book Value Adjustment Amount") and (2) the
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excess, if any, of the Debt Adjustment Amount reflected on the Closing
Balance Sheet over the Debt Adjustment Amount determined in accordance with
Section 1.02(a), plus interest from the Closing Date on the amount of such
sum at the rate announced from time to time by National Westminster Bank
Plc as its base rate (the "Base Rate"). The total amount payable to the
Purchaser in accordance with this Section 1.02(c)(iii) is herein referred
to as the "Total Purchase Price Adjustment Amount". In the event that the
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Debt Adjustment Amount reflected on the Closing Balance sheet is less than
the Debt Adjustment Amount determined in accordance with Section 1.02(a),
the Purchaser shall remit an amount equal to the difference to the Sellers'
Solicitor who shall in turn distribute such amount to the Sellers pro rata
based on the number of ordinary shares or class A ordinary shares each
holds at Closing as shown on Exhibit A-I and Exhibit A-II relative to the
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total number of issued ordinary shares and class A ordinary shares at
Closing.
(d) Incoming Cheques. Within forty five (45) days after the Closing
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Date, the Purchaser shall remit to the Sellers' Solicitor an amount (the
"Incoming Cheque Amount") equal to the lesser of (i) the Debt Adjustment Amount
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(as confirmed by the Purchaser) and (ii) the amount of any cheques payable to
the Company which are dated on or prior to the Closing Date and received and
collected by the Company during the thirty-day period immediately following the
Closing Date ("Incoming
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Cheques"). The Sellers' Solicitor shall distribute the Incoming Cheque Amount to
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the Sellers pro rata based on the number of ordinary shares or class A ordinary
shares each holds at Closing as shown on Exhibit A-I and Exhibit A-II relative
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to the total number of issued ordinary shares and class A ordinary shares at
Closing.
Section 1.03. The Closing. Completion of the purchase and sale of the
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Shares hereunder (the "Closing") will take place at 9:30 P.M. (British Summer
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Time) at the offices of Xxxxxxx XxXxxxx, Sceptre Court, 00 Xxxxx Xxxx, Xxxxxx
XX0X 0XX, Xxxxxxx on the date hereof. The date of the Closing is referred to
herein as the "Closing Date".
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Section 1.04. Deliveries by the Sellers. At the Closing, and upon
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satisfaction or waiver of the conditions set forth in Section 4.02 herein, the
Sellers will deliver or cause to be delivered to the Purchaser or its nominee
the instruments, consents, opinions, certificates and other documents to be
delivered by the Sellers under Section 4.01.
Section 1.05. Deliveries by the Purchaser. At the Closing, and upon
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satisfaction or waiver of the conditions set forth in Section 4.01 herein, the
Purchaser will deliver or cause to be delivered to the Sellers' Solicitor the
documents and payment to be delivered by it under Section 4.02.
Section 1.06. Appointment of Individual Seller Representatives and
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Sellers' Solicitor.
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(a) Each of the Individual Sellers hereby appoints Xxxxx Xxxx and
Xxxxxx Xxxxxxx Xxxxx as such Individual Seller's sole and exclusive agents with
respect to this Agreement and the Escrow Agreement (the "Individual Seller
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Representatives"); and Xxxxx Xxxx and Xxxxxx Xxxxxxx Xxxxx hereby accept such
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appointment. In such capacity, the Individual Seller Representatives shall be
authorized, in their sole discretion, to consent to such amendments,
modifications, waivers and revisions to this Agreement and the Escrow Agreement
on behalf of the Individual Sellers as the Individual Seller Representatives
shall deem appropriate, and to take any and all actions on behalf of the
Individual Sellers, including without limitation (i) jointly with each of the
Institutional Sellers, causing the Sellers' Solicitor to deduct from the Initial
Amount all fees and expenses
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of the Company relating to the transactions contemplated hereby, including
without limitation the fees and expenses of the Sellers' Solicitor, and
thereafter to distribute the balance thereof to the Sellers in accordance with
Section 1.02(a), (ii) executing closing certificates and documents as the
Individual Seller Representatives shall deem appropriate, (iii) receiving
communications from and sending communications to other parties hereto in
connection with the matters contemplated hereby and (iv) making binding
determinations regarding the operation of Article V hereof but only insofar as
such determinations relate to claims against the Escrow Amount, and the
signature of the Individual Seller Representatives, in each such case, shall be
sufficient to evidence the approval of each of the Individual Sellers thereto.
The Individual Seller Representatives shall not be liable to any Individual
Seller for any action taken by the Individual Seller Representatives in good
faith pursuant to this Agreement, and the Individual Sellers shall jointly and
severally indemnify the Individual Seller Representatives from any losses,
claims, damages and expenses arising out of their serving as agents hereunder.
(c) The Purchaser shall not be liable to any Seller for any action
taken by the Individual Seller Representatives or the Sellers' Solicitor, or for
the failure of the Individual Seller Representatives or the Sellers' Solicitor
to take any action, and the Purchaser shall have the right to assume the
genuineness of all documents submitted to the Purchaser as having been executed
by the Individual Seller Representatives or the Sellers' Solicitor. Without
limiting the foregoing, payment of the Purchase Price by the Purchaser to the
Sellers' Solicitor shall be deemed to be payment to the Sellers.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
OF THE SELLERS
The Principal Sellers hereby jointly and severally represent and warrant to
the Purchaser that each of the statements contained in Sections 2.01 through
2.28 of this Article II is true and correct. Each of the Other Sellers hereby
severally represents and warrants to the Purchaser that each of the statements
contained in Section 2.29 of this Article II is true and correct. All
representations and warranties set forth in
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this Article II (except for Section 2.06) shall apply to each subsidiary of the
Company as if each reference to the Company was also a reference to such
subsidiary.
Section 2.01. Organization, Power and Standing; Memorandum and Articles of
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Association. The Company is a company duly incorporated with limited liability
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and validly existing under the laws of England, with all requisite power and
authority (corporate and otherwise) to own, lease and operate its properties and
to carry on the business of the Company and its subsidiaries as presently
conducted (the "Business"). The copies of the Memorandum and Articles of
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Association, as amended, of the Company set forth in Schedule 2.01 are true,
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correct and complete.
Section 2.02. Foreign Qualifications. The Company is duly qualified and
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authorized to do business as a foreign corporation and is in good standing (to
the extent relevant) in each jurisdiction in which the failure to so qualify
could have a Material Adverse Effect. As used herein, "Material Adverse Effect"
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means a material adverse effect in the Business, assets, operations, affairs,
condition (financial (including, without limitation, net book value) or
otherwise) or prospects of the Company.
Section 2.03. Subsidiaries. Except as set forth on Schedule 2.03, the
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Company does not have any subsidiaries nor does the Company, directly or
indirectly, own or have the right to acquire any equity interest or loan capital
in any corporation, joint venture, partnership or other entity legally or
beneficially.
Section 2.04. Validity and Enforceability. This Agreement is, and each of
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the other agreements and instruments of each Seller contemplated hereby are
valid and binding obligations of each Seller enforceable against each of them in
accordance with their respective terms, subject, however, to limitations on
enforcement imposed by bankruptcy, insolvency, reorganization or similar laws
affecting the enforcement of the rights of creditors, and to the extent that
equitable remedies such as specific performance and injunctions are only
available at the discretion of the court from which they are sought.
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Section 2.05. Capitalization.
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(a) The authorized, issued and outstanding share capital of the
Company, and the owners thereof, are set forth in Schedule 2.05 attached hereto.
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All outstanding shares of the Company are duly authorized, validly issued, fully
paid and nonassessable. Except as set forth on Schedule 2.05, there are no
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outstanding options, warrants, rights, subscriptions, claims of any character,
obligations, calls, commitments, conversion rights, rights of exchange, plans or
other agreements of any character granted by the Company providing for the
purchase, issuance or sale of any such shares, warrants, or rights of the
Company other than as contemplated by this Agreement. No shares of the Company
are issued but not allotted.
(b) All of the Shares are owned beneficially and legally by the
respective Seller specified in Schedule 2.05. The respective owners of the
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Shares have good and valid title to such shares, free and clear of all
Encumbrances, and the delivery to the Purchaser or its nominee of the Shares
pursuant to the provisions of this Agreement will transfer said title thereto,
free and clear of all Encumbrances. All of the Shares were offered and sold by
the Company in compliance with, or exempt from, all applicable securities laws.
(c) All of the shares of each subsidiary of the Company are owned
beneficially and legally by the Company. The Company has good and valid title
to such shares, free and clear of all Encumbrances. All of such shares were
offered and sold by each subsidiary to the Company in compliance with, or exempt
from, all applicable securities laws.
(d) The Company is not subject to any obligation (contingent or
otherwise) to purchase or otherwise acquire or retire any of its equity
securities. No person or entity has any right of first refusal, right of first
offer, preemptive right or other similar right (i) in connection with the
transfer or sale to the Purchaser or its nominee of the Shares or (ii) with
respect to any future offer, sale or issuance of shares in the Company.
(e) The offer and sale of the Shares pursuant to this Agreement will
comply with or will be exempt from all applicable securities laws.
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Section 2.06. Financial Statements. Attached to this Agreement as
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Schedule 2.06 are true copies of the audited consolidated accounts of the
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Company and its subsidiaries for the financial periods ended April 30, 1996 and
April 30, 1995 and the unaudited consolidated balance sheet of the Company and
its subsidiaries (the "Balance Sheet") as of March 31, 1997 (the "Balance Sheet
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Date") and the related unaudited statement of operations, changes in
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shareholders' equity and cash flows for the eleven months ended March 31, 1997
(collectively, the "Financial Statements"). Except as disclosed on Schedule
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2.06, the Financial Statements are correct, have been prepared in accordance
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with GAAP, consistently applied, and fairly present, on a consolidated basis,
the financial condition of the Company and its subsidiaries and the results of
their operations and cash flows as of, and for the period ending on, the
respective dates thereof. The unaudited Financial Statements are accompanied by
a certificate, signed on behalf of the Company by the officer or director of the
Company primarily responsible for financial and accounting matters, which
confirms (i) that he has reviewed the unaudited Financial Statements and (ii)
that they fairly present the financial condition of the Company and its
subsidiaries as of such date and the results of their operations and cash flows
for the period ending on such date.
Section 2.07. Material Adverse Changes. Except as set forth on Schedule
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2.07, since the Balance Sheet Date, the Business of the Company has been
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operated only in the usual and ordinary course consistent with past practice,
and there has been no event or condition which has had, or will have, a Material
Adverse Effect.
Section 2.08. Material Contracts. Schedule 2.08 sets forth a complete and
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accurate list of all of the following, whether written or unwritten
(collectively, the "Contracts"):
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(a) contracts, purchase orders and grants involving future payment or
receipt of funds in excess of (Pounds)10,000 or future performance or receipt of
services or delivery or receipt of goods and materials, in each case with an
aggregate value in excess of (Pounds)10,000, including but not limited to sale
and purchase agreements and distribution agreements;
(b) contracts under which the amount payable by the Company is
dependent on the revenue, income or similar measure of
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the Company;
(c) licenses, leases, contracts and other arrangements with respect to
any material property of the Company including without limitation all software
licenses (other than those that are generally commercially available);
(d) agreements, contracts or instruments to which the Company is a
party relating to (i) the borrowing of any money, (ii) the capital lease or
purchase on an installment basis of any asset involving in the aggregate more
than (Pounds)30,000, or (iii) the guarantee of any of the foregoing;
(e) agreements of the Company with any Seller or any associate (as
defined in Sections 417 and 416 of the Income and Corporation Taxes Act 1988) of
a Seller;
(f) contracts which place any material limitation on the method of
conducting or scope of the Business;
(g) collective bargaining, severance, consulting, deferred
compensation, benefit and similar plans and agreements;
(h) sales representative, marketing, distribution or similar contracts
to which the Company is a party; and
(i) any other agreement material to the Company or the Business.
The Company and the Sellers have furnished to the Purchaser copies of all
of the Contracts (or, if oral contracts, have provided accurate summaries
thereof). Each Contract sets forth in all material respects the entire
agreement and understanding between the parties thereto. Each Contract is
valid, binding and in full force and effect as against each of the parties
thereto, and there is no event which has occurred or exists, which constitutes
or which, with notice, the happening of any event and/or the passage of time,
would constitute a material default or breach under any such contract by any
party thereto, or would cause the acceleration of any obligation of any party
thereto or give rise to any right of termination or cancellation thereof (a
"Default").
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Section 2.09. Real Property.
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(a) The properties described in Schedule 2.09, and any right or
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interest therein (collectively, the "Property") comprise all the land and
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buildings owned, leased or occupied by the Company. The Company has exclusive,
undisputed and unrestricted possession of the Property.
(b) The Company has good and marketable title to the Property for the
estate or interest set out in Schedule 2.09, free from all options, liens,
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charges, mortgages, disputes, encumbrances, tenancies (including tenancies
protected by statute or otherwise), adverse rights, informal adverse
arrangements and overriding interests as defined in Section 70(1) (as amended)
Land Registration Xxx 0000.
(c) The Company has complied with all covenants and obligations
(including statutory obligations) relating to the Property.
(d) All necessary consents, certificates, permits and approvals have
been obtained and are in force for any proposed development or use of, proposed
works to or the proposed storage of any substances in, all or any part of the
Property required for the Business or in respect of which the Company has
incurred any expense or entered into any commitment.
(e) True and complete copies of all leases, sub-leases, tenancy
agreements, tenancies, wayleaves, licences, grants, easements, mortgages,
debentures and other agreements affecting the Property have been furnished to
the Purchaser and the Company has not committed any breach thereof. The Company
is under no obligation or liability in respect of any claim for dilapidations
arising as a result of the expiry of any lease or license under which the
Company holds or has held any leasehold interest or occupied any property. The
Property is not subject to any restriction against charging, letting,
underletting or assignment.
(f) There are no subsisting material entries registered against the
Property or the Company or under the relevant title numbers at HM Land Registry,
HM Land Charges Registry or at the Local Land Charges Registry or elsewhere
affecting the Property or the Company.
(g) There are no notices, charges, restrictions, or
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requirements of or agreements with any local, planning or other authority or
covenants (restrictive or otherwise), exceptions, restrictions or reservations
detrimentally affecting the Property or adversely affecting its value or any
existing or proposed use of the Property or requiring the carrying out of works
or any payment by the Company.
(h) The Company does not have any liabilities as original tenant,
assignee, guarantor under an authorized guarantee agreement as defined by the
Landlord and Tenant (Covenants) Xxx 0000 or otherwise in respect of any premises
now or previously owned or occupied by any person.
(i) Without prejudice to the above representations and warranties, the
Principal Sellers shall be liable to the Purchaser to at least the same extent
as if the Property, according to its tenure, had been disposed of by the Sellers
to the Purchaser for valuable consideration and in the disposition the Sellers
had been expressed to make the disposition with full title guarantee and with
the benefit of the implied covenants contained in part 1 of the Law of Property
(Miscellaneous Provisions) Xxx 0000 and the disposition had been made subject
only to such Encumbrances or other interests as have been disclosed to the
Purchaser.
Section 2.10. Personal Property. Schedule 2.10 is a complete and accurate
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list of each item of tangible personal property owned, leased or licensed by the
Company that has a book value of at least (Pounds)20,000, indicating whether
such item is owned, leased or licensed. Except as set forth on Schedule 2.10,
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the Company has good title to or a valid leasehold interest in each item of
personal property used by it, including all assets reflected on the Balance
Sheet, free and clear of all Encumbrances except for Permitted Encumbrances.
The assets and properties of the Company include all assets currently used in
the conduct of the Business by the Company and are adequate to conduct the
operations of the Company as currently conducted. As used herein, "Permitted
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Encumbrance" means (a) materialmans, mechanics, and other similar liens arising
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by operation of law or statute, securing obligations incurred in the ordinary
course of business that are not yet due and payable, and (b) unregistered liens
for taxes and assessments incurred in the ordinary course of business that are
not yet due and payable.
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Section 2.11. Tax Matters.
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(a) The Balance Sheet properly reserves or provides for any taxation,
duty, levy, charge, impost or contribution of whatever nature imposed by any
jurisdiction or any statutory governmental body or official (whether federal,
state, provincial or municipal authority) whatsoever thereof, whenever imposed,
and any interest, surcharge, penalty or fine in relation thereto ("Taxation")
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for which the Company was liable at the Balance Sheet Date whether or not the
Company has or may have any right of reimbursement against any other person and
the Balance Sheet properly reserves or provides for any contingent or deferred
liability for Taxation.
(b) The Company has paid all Taxation that has become due.
(c) The Company has punctually made all such returns, given all such
notices, provided all such information and maintained all such records in
relation to Taxation as are required to be made or provided or maintained by the
Company.
(d) The Company has duly complied with its obligations in relation to
pay as you earn and earnings-related contributions and its reporting obligations
to the Inland Revenue in connection with any benefits provided to employees and
directors of the Company.
(e) The Company has sufficient records to calculate the liability to
Taxation which would arise on any disposal or realization of any asset owned by
the Company at the Balance Sheet Date or acquired since that date but before
Closing.
(f) The Company has duly submitted all claims and disclaimers which
have been assumed to have been made for the purposes of the Financial
Statements.
(g) The Company is duly registered in accordance with Value Added Tax
Xxx 0000 ("VATA") and has made, given, obtained and kept full, correct and up-
----
to-date records, invoices and other documents appropriate or required for the
purposes thereof and is not in arrears with any payment or returns due
thereunder and has not been required by HM Customs and Excise to give security
under Paragraph 4 of Schedule 11 VATA.
15
(h) The Company has never been a member of a group for the purposes of
Section 43 VATA.
(i) The Company has not been in default in respect of any accounting
period for the purposes of Section 59 VATA.
(j) Full details of any claim for bad debt relief under Section 22
Value Added Tax Xxx 0000, Section 11 Finance Xxx 0000 or Section 36 VATA made by
the Company are set out or annexed to Schedule 2.11 attached hereto.
-------------
(k) All value added tax payable upon the importation of goods and all
excise duties payable in respect of any assets (including trading stock)
imported or owned by the Company have been paid in full.
(l) The Company is not and does not expect to be involved in any
dispute in relation to Taxation and neither the Inland Revenue, Customs and
Excise or other fiscal authority concerned has investigated or, to the best of
the Company's and the Principal Sellers' knowledge having made no enquiry,
indicated that it intends to investigate the Company.
(m) The value attributed to each asset of the Company reflected in
the Balance Sheet on the Balance Sheet Date is such that on any disposal of any
such asset for a consideration equal to such value (and disregarding any
statutory right to claim any allowance or relief)(i) no liability to Taxation
will arise and (ii) no balancing charge will be made on the Company.
(n) No liability to Taxation will arise on the disposal by the Company
of any asset acquired since the Balance Sheet Date but prior to Closing for a
consideration equal to the consideration actually given for the acquisition.
(o) Since the Balance Sheet Date the Company has not entered into or
been a party to any transaction, otherwise than in the ordinary course of
business, which will or may give rise to a liability to Taxation, and no
accounting period of the Company has terminated.
(p) The Company will not incur any liability to Taxation under Section
132 Finance Xxx 0000 or Sections 190 to 191 Taxation of Chargeable Gains Xxx
0000 ("TCGA").
----
16
(q) Full details of all assets currently owned by the Company on or
after the Balance Sheet Date in respect of which a charge to Taxation might
arise under Sections 178 and 179 TCGA are set out in Schedule 2.11 attached
-------------
hereto.
(r) Full particulars of each claim under Sections 152 to 154 TCGA made
prior to the date hereof which affects any asset owned by the Company on or
after the Balance Sheet Date are set out in Schedule 2.11 attached hereto.
-------------
(s) The Company has not made any repayment of share capital to which
Section 210 Income and Corporation Taxes Act 1988 ("Taxes Act") applies or
---------
issued any share capital as paid up otherwise than by the receipt of new
consideration within the meaning of part IV Taxes Act.
(t) The Company is not liable to make any payment of interest or any
annual payment for which no relief will be received by reason of Section 125
Taxes Act or Section 787 Taxes Act or by reason of it being a distribution.
(u) The Company has made all deductions in respect, or on account, of
any Taxation from any payments which it is required or entitled to make and has
accounted in full to the appropriate authority for all amounts so deducted.
(v) Except as set forth on Schedule 2.11 attached hereto, the Company
-------------
has never been resident outside the UK, nor has it ever carried on any trade,
business or other activities outside the UK.
(w) The Company has not, without prior consent of the relevant
governmental authority, caused, permitted or entered into any of the
transactions specified in Section 765 Taxes Act.
(x) The Company has not in the six years preceding Closing been a
party to any transaction in respect of which the Company would be liable to
Taxation under the provisions of part XVII Taxes Act or as a result of the
principle in Xxxxxxx x. Xxxxxx, 55 TC 324.
-----------------
(y) The Company does not hold any shares as trading stock.
17
(z) Except as provided in the unaudited Financial Statements, no
event, transaction, act or omission has occurred which would result in the
Company becoming liable to pay or to bear any Taxation which is primarily or
directly chargeable against or attributable to any person, firm or company other
than the Company.
(aa) Schedule 2.11 attached hereto sets out full details of all claims
-------------
for group relief under Chapter IV of part X Taxes Act and full details of all
claims for the surrender of advance corporation tax under Section 240 of Taxes
Act for the six years preceding the Balance Sheet Date and the Company is not
liable to make any payment for any group relief or advance corporation tax
surrendered to it.
(bb) Group income elections under Section 247 Taxes Act have been made
and remain in force.
(cc) As at the Balance Sheet Date, the Company had losses in the
amount set forth on Schedule 2.11 and such losses are immediately available for
-------------
set-off.
(dd) The Company has never been a close company.
(ee) There is no unsatisfied liability to inheritance tax attached or
attributable to the assets of the Company or the shares of the Company and
neither the assets nor the shares are subject to an Inland Revenue charge as
mentioned in Section 237 Inheritance Tax Act 1984 ("IHTA").
----
(ff) No person has the power under Section 212 IHTA to raise any
inheritance tax by sale or mortgage of or by a terminable charge on any of the
Company's assets.
(gg) The Company does not have any outstanding liability to pay
development land tax by installments.
(hh) All documents which are required to be stamped and are in the
possession of the Company or by virtue of which the Company has any right have
been duly stamped.
(ii) The Company has not incurred a liability to stamp duty reserve
tax since the Balance Sheet Date.
18
(jj) Neither the Company nor the Purchaser will incur any liability
for Taxation as a result of the transactions contemplated hereby.
(kk) All representations, warranties, covenants and agreements of the
Sellers contained in the Tax Deed delivered to the Purchaser at Closing pursuant
to Section 4.01(g)(vii) are true and correct.
Section 2.12. Required Consents; No Defaults. Except for the consents
------------ ------------------------------
specified on Schedule 2.12, no consent, order, authorization, approval,
-------------
declaration or filing with any governmental authority or any party to a Contract
is required (a) for or in connection with the execution, delivery or performance
of this Agreement by the Company, (b) for or in connection with the execution,
delivery or performance of this Agreement by any Seller, or (c) to prevent a
Default under any Contract arising out of the sale of the Shares hereunder.
Subject to obtaining the consents and other items specified on Schedule 2.12,
-------------
the execution, delivery and performance of this Agreement and the other
instruments and agreements contemplated hereby will not result in any violation
of, be in conflict with or constitute a default under, any law, Contract,
judgment, decree or order to which the Company or any Seller is a party or by
which any of them is bound.
Section 2.13. License and Permits. Schedule 2.13 sets forth all material
------------ ------------------- -------------
licenses, permits and authorizations of governmental authorities held by the
Company pertaining to the Business. The Company is in compliance with all such
licenses, permits and authorizations, all of which are in full force and effect.
There are no other such licenses, permits or authorizations which are material
to the Company or its Business.
Section 2.14. Pensions.
------------ --------
(a) Schedule 2.14 sets forth all agreements, arrangements, customs or
-------------
practices (whether legally enforceable or not) for the payment of or
contribution towards or in respect to any pensions, allowances, lump sums or
similar benefits on retirement, death, sickness or disablement for or in respect
of any current or former director or employee of the Company ("Disclosed
---------
Schemes") and no proposal has been announced to establish any other such
agreement or arrangement.
19
(b) In relation to each Disclosed Scheme, there are no contributions
or insurance premiums payable by the Company which have fallen due but are
unpaid.
Section 2.15. Employment Practices; Employment Agreements.
------------ -------------------------------------------
(a) A true, correct and complete copy of the employment agreement,
service agreement, severance agreement and similar document specifying the terms
and conditions of employment for each employee of the Company (and in the case
of any oral agreement, an accurate summary thereof), along with an accurate
summary of the current compensation and other benefits currently paid or
provided, as the case may be, to such employee (and comparable figures for such
amounts paid or provided in the prior fiscal year of the Company) is attached
hereto as Schedule 2.15.
-------------
(b) No director or employee of the Company is serving the Company on
terms which either expressly or impliedly preclude the Company from lawfully
terminating his employment on not more than three months' notice without
compensation (other than statutory compensation) and for the purposes of
assessing any notice or compensation entitlement no period of employment with
any employer other than the Company fails to be taken into account.
(c) The Company has at all times duly complied with all statutory and
other legal obligations and requirements in respect of its employees and former
employees.
(d) The Company is under no obligation to make any consultancy,
annuity, pension or other periodic payments (other than normal fixed salaries
and wages) to any person (including but not limited to any present or former
employee or director of the Company) or to make any periodic payments which will
not be allowable as a deduction in computing the profits of the Company for
taxation purposes. Except as set forth in Schedule 2.15, no person is
-------------
remunerated by the Company on a profit sharing or commission basis.
(e) The Company has no legal obligation to make any contributions or
payments in connection with any pension, superannuation, assurance, death or
disability scheme or arrangement, or to pay redundancy, gratuities, or
compensation
20
for loss of office to or in respect of any ex-directors or ex-employees of the
Company or others or their dependants and no such obligation has arisen or will
arise on or prior to Closing in respect of directors or employees of the Company
or their dependants.
(f) Neither the Company nor any of its employees is involved in any
industrial dispute, and there are no facts known to the Company or the Sellers
which indicate that there may be any industrial dispute involving the Company or
that the sale of the Shares may lead to any such industrial dispute.
(g) To the best of the Company's and the Principal Sellers' knowledge
(having made no enquiry), no employee is a member of any trade union. No trades
unions are recognized by the Company for any purpose and the Company is not a
party to any collective or other group wage bargaining arrangements.
(h) None of the activities of the Company are within the scope of any
order under the Industrial Training Act 1982 nor has there been any indication
that any such order is being considered or may be made.
Section 2.16. Intellectual Property.
------------ ---------------------
(a) For the purpose of this Section:
"Intellectual Property" means all patents, trademarks, service marks,
---------------------
designs, trade names, business names, copyrights, topography rights, design
rights, Know-How (as defined below), trade secrets and all other industrial or
commercial monopoly rights, intellectual property rights and rights or forms of
protection of the same or of a similar or equivalent nature or effect which may
subsist anywhere in the world whether or not registered or capable of
registration and together with all applications for registration of and rights
to apply for any of the foregoing; and
"Know-How" means all information, data and methodology not at present
--------
in the public domain and all financial, commercial, trade and business secrets
of whatever nature and in whatever form without limitation.
(b) The Company's Intellectual Property:
21
(i) is exclusively and absolutely vested in, beneficially owned
by, or validly granted to, the Company free from any Encumbrance; and
(ii) comprises all the Intellectual Property required by the
Company to carry on the Business as now constituted, or required for or in
connection with the use, application or supply of the products and services
currently produced or supplied by the Company.
(c) Except for the Intellectual Property set out in Schedule 2.16, the
-------------
Company does not own, use or rely on, or require to own, use or rely on for the
proper conduct of its business, any Intellectual Property.
(d) The Company has the exclusive right to use, exploit, disclose and
derive benefit from the Company's Intellectual Property. No right or license
has been granted to any person to use in any manner or to do anything which
would or might otherwise infringe any of the Company's Intellectual Property and
no act has been done or omitted to be done which will or might result in any of
the Company's Intellectual Property ceasing to be valid, in force and
enforceable or which might result in the cancellation, revocation, rectification
or modification of the same.
(e) To the best of the Company's and the Sellers' knowledge, the
Company does not in carrying on its business use any Intellectual Property under
license, or infringe any Intellectual Property rights; and no claim against the
Company in respect of any infringement of any Intellectual Property or which
challenges the validity or the Company's ownership of or exclusive right to use,
exploit, disclose or derive benefit from any Intellectual Property has been
made, threatened or indicated.
(f) The Company is not a party to any secrecy, confidentiality or
other agreement which may restrict its use or disclosure of any Know-How.
(g) No disclosure has been made to any third party of any Know-How of
the Company or relating to the Company save as is necessary in the ordinary
course of its normal trading and subject to valid obligations upon the third
party not to use or disclose the same.
22
(h) To the best of the Company's and the Sellers' knowledge, there is
and has been no infringement of any of the Company's Intellectual Property.
(i) The Company does not use, or otherwise carry on its business
under, any name other than its corporate name and the names "WED", "ORBIS",
"Microloader", "Macrospec", "Microsorter" and "AML".
Section 2.17. Accounts Receivable. Set forth on Schedule 2.17 are a list
------------ ------------------- -------------
of all accounts receivables of the Company, and an aging schedule relating
thereto, each as of March 31, 1997. Such accounts receivable are, and any
accounts receivable arising between such date and the Closing Date will be,
valid and subsisting (or collected) and all such accounts receivable ("Accounts
--------
Receivable") arose in the ordinary and usual course of the Company's business.
----------
The Accounts Receivable are not subject to any counterclaim, set-off, defense,
security interest, claim or other encumbrance. Except to the extent of any
reserve therefor on the Balance Sheet, 75% of the aggregate amount of the
Accounts Receivable reflected on the Closing Balance Sheet will be collected on
or before 90 days after the Closing Date and the remaining 25% will be collected
on or before the first anniversary of the Closing Date.
Section 2.18. Regulatory and Legal Compliance. The Company is in
------------ -------------------------------
compliance with all laws, judgments, decrees and orders applicable to it.
Except as set forth on Schedule 2.18, no governmental or regulatory authority
-------------
or other person or entity has alleged any violation or noncompliance with any
law, judgment, decree or order with respect to the Company or the Business.
Section 2.19. Insurance. Schedule 2.19 sets forth all insurance policies
------------ --------- -------------
under which the Company and its assets are insured, all of which are valid and
in full force. All premiums due to date under such policies have been paid, and
no default exists thereunder. The insurance listed on Schedule 2.19 is in
-------------
amounts adequate to cover losses on physical assets. Neither the Company nor
any of the Sellers has received, since January 1, 1996, notice of any proposed
material increase in the premiums payable for coverage, or proposed material
reduction in the scope (or discontinuation entirely) of coverage, under any of
such insurance policies.
23
Section 2.20. Litigation. Except as set forth on Schedule 2.20, there is
------------ ---------- -------------
no action, suit, proceeding or investigation before any court, arbitrator or
governmental authority, pending or, to the best of the Principal Sellers'
knowledge having made no enquiry, threatened against (a) the Company, (b) any of
the Sellers with respect to the Business, or (c) any officer, director or
employee of the Company in relation to the Business.
Section 2.21. Proprietary Information of Third Parties. Except as set
------------ ----------------------------------------
forth on Schedule 2.21, no third party has claimed or, to the Company's and each
-------------
Seller's knowledge, has reason to claim that any person employed by the Company
has (a) violated or may be violating any of the terms or conditions of such
person's employment, non-competition or non-disclosure agreement with such third
party, (b) disclosed or may be disclosing or utilized or may be utilizing any
trade secret or proprietary information or documentation of such third party or
(c) interfered or may be interfering in the employment relationship between such
third party and any of its employees. No person or entity employed by the
Company has employed or proposes to employ any trade secret or any information
or documentation proprietary to any other person or entity in connection with
the Business.
Section 2.22. Environmental Matters. The use of the premises and assets
------------ ---------------------
of the Company, the occupancy and operation thereof, and the conduct by the
Company of its operations and Business are in compliance in all material
respects with all applicable laws relating to pollution, environmental
protection, hazardous substances and related matters. There is no liability
attaching to such premises or assets or the ownership or operation thereof as a
result of any hazardous substance that may have been discharged on or released
from such premises, or disposed of on-site or off-site, or any other
circumstance occurring prior to the Closing or existing as of the Closing. For
purposes of this Section, "hazardous substance" shall mean any substance which
is included within the definition of a "hazardous substance", "pollutant",
"toxic substance", "toxic waste", "hazardous waste", "contaminant" or other
words of similar import in any law.
Section 2.23. Absence of Undisclosed Liabilities. Except for (a) actual
------------ ----------------------------------
or contingent liabilities or obligations(including accounts payable and accrued
expenses) disclosed in the Balance Sheet, and other liabilities incurred in the
ordinary course of
24
business since the Balance Sheet Date, and (b) actual or contingent liabilities
or obligations under Contracts and other contracts entered into in the ordinary
course of business, the Company does not have any claims, indebtedness,
liabilities or obligations, whether absolute, accrued, contingent or otherwise
and whether due or to become due.
Section 2.24. Brokers, Etc. No finder, broker, agent, financial advisor or
------------ ------------
other intermediary has acted on behalf of any Seller or the Company in
connection with the negotiation or consummation of this Agreement or any of the
transactions contemplated hereby and no such person or entity is entitled to any
fee, payment, commission or other consideration in connection therewith as a
result of any arrangement made by any of them.
Section 2.25. Banking Relations; Powers of Attorney. All material
------------ -------------------------------------
arrangements which the Company has with any banking institution are described on
Schedule 2.25 indicating with respect to each of such arrangements the type of
-------------
arrangement maintained and the person or persons authorized in respect thereof.
The Company has not granted a power of attorney or other banking authority to
any person except as indicated on Schedule 2.25.
-------------
Section 2.26. Warranty Claims. Except as set forth on Schedule 2.26, the
------------ --------------- -------------
Company has not made any guarantee, representation or warranty to its customers
or to any other person with respect to products sold or services delivered by
the Company (collectively, "Warranties"). The value and substance of all claims
----------
made by any person within each of the last two years under Warranties is
described on Schedule 2.26).
-------------
Section 2.27. Inventory. All of the inventories and supplies (stock)
------------ ---------
reflected on the Balance Sheet and on hand as of the Closing (collectively, the
"Inventory") consist of items of quality and quantity usable or resalable in the
---------
normal course of Business. Since the Balance Sheet Date, the Company has
continued to replenish the Inventory in a normal and customary manner consistent
with past practice. There is no Inventory that is damaged or obsolete or that
will not be sold in the ordinary course of business within twelve months
following the Closing Date (excluding Reclassified Fixed Assets (as defined in
Section 1.02(c)). Neither the Company nor any Seller has received any notice
that the Company may experience in the future any
25
difficulty in obtaining, in the desired quantity and quality and at reasonable
prices and upon reasonable terms and conditions, the Inventory or any other
materials, supplies or equipment required for the Business.
Section 2.28. Disclosure. The representations, warranties and other
------------ ----------
statements of the Company and the Sellers contained in this Agreement, the
Disclosure Letter (as defined in Section 6.14), the Escrow Agreement and the
other documents, certificates and instruments delivered pursuant hereto or
thereto at the Closing as of the date hereof or as of the Closing Date to the
Purchaser by or on behalf of the Company or the Sellers, taken as a whole, do
not contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements contained herein and therein not
misleading as of the date hereof.
Section 2.29. Other Sellers' Representations and Warranties.
------------ ---------------------------------------------
(a) This Agreement and each of the other agreements and instruments of
such Other Seller contemplated hereby is the valid and binding obligation of or
on such Other Seller enforceable against such Other Seller in accordance with
its respective terms, subject, however, to limitations on enforcement imposed by
bankruptcy, insolvency, reorganization or similar laws affecting the enforcement
of the rights of creditors, and to the extent that equitable remedies such as
specific performance and injunctions are only available at the discretion of the
court from which they are sought.
(b) All of the Shares specified on Schedule 2.05 to be sold hereunder
-------------
by such Other Seller to the Purchaser are owned legally by such Other Seller.
Such Other Seller has good and valid title to such shares, free and clear of all
Encumbrances, and the delivery to the Purchaser or its nominee of the stock
transfer forms in respect of the Shares of such Other Seller pursuant to the
provisions of this Agreement will, subject to the same being duly stamped with
the appropriate ad valorem duty, transfer good and valid title thereto, free and
clear of all Encumbrances.
(c) No consent, order, authorization, approval, declaration or filing
with any governmental authority or any
26
party to a Contract is required for or in connection with the execution,
delivery or performance of this Agreement by such Other Seller. The execution,
delivery and performance of this Agreement and the other instruments and
agreements contemplated hereby will not result in any violation of, be in
conflict with or constitute a default under, any law, Contract, judgment, decree
or order to which such Other Seller is a party or by which such Other Seller is
bound.
ARTICLE III
COVENANTS OF THE SELLERS
Section 3.01. Confidentiality. Following the Closing, the Sellers shall
------------ ---------------
hold in confidence all knowledge and information of a proprietary or
confidential nature with respect to the Business and shall not disclose, publish
or make use of the same without the express prior written consent of the
Purchaser, except (a) to the extent that such information shall have become
public knowledge other than by breach of this Agreement by a Seller, (b) as
necessary to file tax returns or other required reports with governmental
agencies, regulatory authorities or the London Stock Exchange, as otherwise
required by law or to enforce this Agreement, (c) for information that is
lawfully and independently obtained by a Seller after the Closing from a third
party without restriction as to disclosure or use by such Seller or is disclosed
or used by a Seller only to the extent permitted by restrictions imposed by such
third party or (d) for information that is independently developed by a Seller
after the Closing without reference to information of a proprietary or
confidential nature with respect to the Business or the Company known to such
Seller prior to the Closing.
Section 3.02. Non-competition.
------------ ---------------
(a) Each Director (as hereinafter defined) covenants with the
Purchaser that he will not directly or indirectly, or as a shareholder, partner,
employee, consultant or other owner or participant in any business entity, for a
period of two years after the Closing Date: (i) engage, or assist any other
person or entity to engage, in a business that competes with the Company's
Business; (ii) use, or assist any other person in the use of, customer lists of
the Company for any purpose; or (iii) solicit
27
or endeavor to entice away from the Purchaser or the Company, or otherwise
materially interfere with the business relationship of the Purchaser or the
Company with, any person who is, or was during the two-year period prior to the
Closing Date, employed by or associated with the Company. Notwithstanding the
foregoing, nothing in this Agreement shall restrict or prevent any Director from
investing or trading in any entity that competes with the Company's Business if
such investment represents not more than 2% of the issued and outstanding
securities of any class of such entity. "Director" shall mean each of the
--------
individuals listed on Schedule 3.02 hereto.
-------------
(b) Each Director who, after Closing, will remain connected with the
Company as a director, employee, consultant, agent or otherwise hereby agrees
that the provisions of Section 3.02(a) hereof shall apply and continue in force
for so long as such Seller remains connected with the Company as aforesaid and
for a period of two years thereafter.
(c) Each Director hereby covenants with the Purchaser that he will not
at any time, in relation to any business, directly or indirectly use or allow to
be used (other than by the Company) any trade or corporate name used by the
Company at the date hereof or any name similar thereto or which is intended or
likely to be confused therewith.
(d) The Directors acknowledge that they consider the covenants and
provisions of this Section 3.02 to be necessary to protect the goodwill of the
business carried on by the Company and a factor on which the consideration
payable by the Purchaser is based, but if any of such covenants or provisions
are held to be void of invalid but would not have been so held if part of the
wording were deleted or its extent reduced or modified, or if the period or area
or nature of any such restriction were reduced, then such restriction or
provision shall apply with such modification as may be reasonably necessary to
make the same valid and enforceable.
(e) If there is any provision of this Agreement, or of any agreement
or arrangement of which this Agreement forms part, which causes or would cause
this Agreement or that agreement or arrangement to be subject to registration
under the Restrictive Trade Practices Xxx 0000, then that provision shall not
take effect until the day after particulars of this Agreement or of
28
that agreement or arrangement (as the case may be) have been furnished to the
Director General of Fair Trading pursuant to Section 24 of that Act.
Section 3.03. Injunctive Relief; Limitation on Scope. Each Seller
------------ --------------------------------------
acknowledges that any breach or threatened breach of the provisions of Section
3.01 or 3.02 of this Agreement will cause irreparable injury to the Purchaser
for which an adequate monetary remedy does not exist. Accordingly, in the event
of any such breach or threatened breach, the Purchaser shall be entitled, in
addition to the exercise of other remedies, to injunctive relief, without
necessity of posting a bond, restraining any Seller and the Company from
committing such breach or threatened breach.
ARTICLE IV
CONDITIONS TO CLOSING
Section 4.01. Conditions to Obligations of the Purchaser. Unless waived in
------------ ------------------------------------------
writing by the Purchaser, the obligation of the Purchaser hereunder to complete
the transactions contemplated by this Agreement is subject to the satisfaction
at or prior to the Closing of the following conditions:
(a) Licenses, Consents, etc. Received. The Company, the Sellers and
---------------------------------
the Purchaser shall have obtained all consents, licenses, approvals and permits
listed on Schedule 2.12 and no such consent, license, approval or permit shall
-------------
have been withdrawn or suspended.
(b) No Injunction. The completion of the
-------------
transactions contemplated hereby shall not violate any order, decree or judgment
of any court or governmental body having competent jurisdiction.
(c) Certificates; Documents. The Purchaser shall have received from
-----------------------
the Company copies of each of the following: (i) certified copies of the
Memorandum and Articles of Association for the Company and each of its
subsidiaries; and (ii) certified copies of the Certificate of Incorporation of
the Company and each of its subsidiaries.
29
(d) Opinion of Sellers' Solicitor. The Purchaser shall have received
-----------------------------
an opinion of Sellers' Solicitor, dated as of the Closing Date, in form and
substance satisfactory to the Purchaser.
(e) Escrow Agreement. The Purchaser and the Individual Seller
----------------
Representatives shall have entered into an Escrow Agreement in the form of
Exhibit 4.01(e) hereto (the "Escrow Agreement").
--------------- ----------------
(f) Debt Adjustment Amount Certificates. The Purchaser shall have
-----------------------------------
received each of the certificates referred to in Section 1.02(a).
(g) Additional Conditions. The Sellers shall have delivered to (or
---------------------
made available to the satisfaction of) the Purchaser:
(i) definitive certificates for the Shares together with stock
transfer forms in respect thereof duly executed by the registered holders
thereof in favor of the Purchaser (or as it may direct) or, as the case may
be, a deed of indemnity for a lost certificate for Shares, in form and
substance satisfactory to the Purchaser;
(ii) such consents or documents (if any) as may be required to
give evidence of the title of the transferor to the Shares and his or its
capacity to sell or transfer such Shares;
(iii) written resignations of such members of the board of
directors of the Company and its subsidiaries as the Purchaser may request;
(iv) the written resignation (in duplicate) of the auditors of
the Company and of each of its subsidiaries (to take effect from Closing)
together with a statement complying with Section 394(1) Companies Act 1985
and an acknowledgment that they have no claims against the Company or any
of its subsidiaries, whether in respect of fees or otherwise;
(v) releases in agreed form executed as a
30
deed by the members of the boards of directors and officers of the Company
and each of its subsidiaries, releasing the Company and each of its
subsidiaries from all claims whether by way of compensation, remuneration,
redundancy payments, pension rights or otherwise, except only for accrued
remuneration and reimbursable business expenses (if any) up to Closing;
(vi) service agreements in agreed form between the Company and
Xxxxxxx Xxxxx, Xxx Xxxxxxx, Xxxxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxx Xxxxxx and
Xxxxxx Xxxxxx, duly executed and delivered by each of the foregoing;
(vii) a deed in form and substance satisfactory to the
Purchaser, executed by each Principal Seller (the "Tax Deed");
--------
(viii) the seal, certificate of incorporation and statutory
books, duly written up-to-date, of the Company and each of its
subsidiaries;
(ix) all documents of title to the Property and to any
Intellectual Property and such other documents or papers which relate in
any way to the business of the Company as the Purchaser may reasonably
request;
(x) certificates from each of the banks at which the Company and
each of its subsidiaries maintain accounts of the amounts standing to the
debit or credit of such accounts at the close of business on the day
preceding Closing;
(xi) all cheque books and bank mandates of the Company and all
charge, credit or cash cards issued in the name of the Company and each of
its subsidiaries.
(h) Power of Attorney. If this Agreement is executed by any person on
-----------------
behalf of a Seller by virtue of a power of attorney granted to such person by
such Seller, a copy of each such power of attorney, in form and substance
satisfactory to the Purchaser and its counsel, shall be delivered at the
Closing.
31
Section 4.02. Conditions to Obligations of the Sellers. Unless waived in
------------ ----------------------------------------
writing by the Individual Seller Representatives and the Institutional Sellers,
the obligation of each Seller hereunder to consummate the transactions
contemplated hereby is subject to the satisfaction at or prior to the Closing of
the following conditions:
(a) Purchase Price. The Purchaser shall have paid the Purchase Price
--------------
pursuant to Section 1.02 hereof.
(b) Escrow Agreement. The Purchaser and the Individual Seller
----------------
Representatives shall have entered into the Escrow Agreement.
(c) Tax Deed. The Purchaser shall have delivered to the Individual
--------
Seller Representatives a counterpart of the Tax Deed duly executed by the
Purchaser.
ARTICLE V
SURVIVAL; INDEMNIFICATION; ADDITIONAL COVENANTS
Section 5.01. Survival; Additional Covenants.
------------ ------------------------------
(a) The representations, warranties, covenants and agreements
contained herein shall survive the Closing and any investigation made by the
Purchaser. No action for a breach of the representations and warranties
contained herein shall be brought after June 30, 1998, except for (i) claims
arising out of breaches of the representations and warranties contained in
Sections 2.05 and 2.29(b) (which shall survive indefinitely) and Sections 2.11
and 2.14 (which shall survive until the expiration of the applicable statute(s)
of limitations and (ii) other claims of which the Individual Seller
Representatives and the Institutional Sellers have been notified with reasonable
specificity by the Purchaser by June 30, 1998. Any claim made by an Indemnified
Party (as hereinafter defined) (other than claims arising out of breaches of
Sections 2.05, 2.11, 2.14 and 2.29(b)) shall (if it has not been previously
satisfied, settled or withdrawn) be deemed to have been waived or withdrawn on
the expiration of six (6) months after the date such claim was made by the
Indemnified Party unless arbitration proceedings in respect thereof have been
commenced against one or more Sellers; provided, however, that the foregoing
-------- -------
shall not apply if any such
32
delay was caused by a breach of a Seller of the provisions of Section 6.06
hereof.
(b) Each warranty and representation herein shall be construed
independently of any other to the intent that the meaning and effectiveness of
any one warranty or representation shall not be restricted by reference to any
other warranty or representation.
(c) Where the same circumstances could give rise to a claim both for
breach of warranty and representation herein and under the Tax Deed, then:
(i) the Purchaser shall be entitled to claim in respect of either
or both; and
(ii) in calculating sums payable in respect of any breach of
warranty or representation, account shall be taken of sums paid by the
Sellers under the Tax Deed and vice versa.
(d) No claim by the Purchaser shall be prejudiced or reduced in
consequence of any information relating to the Company (other than, in relation
to a claim under the warranties and representations herein, information
disclosed to the Purchaser in a schedule attached hereto as provided herein)
which may have come or may hereafter come to the knowledge of the Purchaser or
its advisers and it shall not be a defense to any claim against the Sellers that
the Purchaser knew or ought to have known or had constructive knowledge (except
as aforesaid) of all or some of the circumstances giving rise to such claim.
(e) The Sellers shall not (in the event of any claim made against any
of them in connection with the sale of the Shares to the Purchaser) make any
claim against the Company or any of its subsidiaries or against any director or
employee of the Company or any of its subsidiaries on whom they have relied
before agreeing to any term of this Agreement or the Tax Deed or authorizing any
statement in a schedule attached hereto.
(f) Where any warranty, representation or other statement contained in
this Agreement is qualified by a reference (howsoever expressed) to the
awareness, knowledge, information or belief of the person by whom such warranty,
representation or
33
statement is given or made, such person shall be deemed (except where otherwise
expressly provided to the contrary) to have given to the Purchaser an additional
warranty and representation that, or to the effect that, he has made due and
careful enquiry regarding, and where reasonably possible verified, all facts and
circumstances relevant to such warranty.
Section 5.02. Limits on Claims.
------------ ----------------
(a) Except in the case of fraud or wilful non-disclosure, the remedies
provided by this Article V shall be the exclusive remedies of the parties to
this Agreement with respect to any losses arising from a breach of the
representations, warranties and covenants contained in this Agreement.
(b) In addition, the sole and exclusive remedy for any claim under
Section 1.02 and/or any claim for indemnification under this Article V by
Indemnified Parties (as defined in Section 5.03), other than a claim based on a
breach of (i) Sections 2.05, 2.11, 2.29(b) or 6.02, or (ii) the Tax Deed, shall
be limited to a withdrawal from the escrow established pursuant to the Escrow
Agreement in the manner set forth therein.
(c) The Principal Sellers shall have no obligation to indemnify any
Indemnified Party for any item of Loss unless all such individual items exceed
(Pounds)25,000; provided, however, that this limitation shall not apply to any
-------- -------
claim for indemnification based on a breach of Section 1.02(c)(iii), 2.05,
2.29(b) or 6.02.
(d) The Principal Sellers' obligation to indemnify an Indemnified
Party shall be reduced:
(i) by the amount of any insurance proceeds received by the
Indemnified Party because of the applicable Loss (as defined in Section
5.03 below), provided that such proceeds relate to an insurance policy in
force prior to the Closing Date;
(ii) to the extent that such obligation results from a change
made by the Purchaser after the Closing in the Company's accounting
policies unless such change was made by the Purchaser in order to comply
with GAAP where such policies were, prior to Closing, not in compliance
with GAAP;
34
(iii) to the extent that such obligation arose as a result of or
is otherwise attributable to (x) any legislation not in force at the date
hereof or any change of law or administrative practice having retrospective
effect which comes into force after the date hereof, (y) any increase in
the rates of taxation in force at the date hereof or (z) the Purchaser or
the Company disclaiming following the Closing Date any part of the benefit
of capital or other allowances against Taxation validly claimed prior to
the Closing Date;
(iv) to the extent of any tax benefit actually realized by the
Indemnified Party with respect to a Loss (as defined in Section 5.03) for
which indemnification is sought hereunder.
(e) The Principal Sellers' indemnity obligations hereunder in respect
of the matter referenced in clause (ii) of the first sentence of Section 5.03
shall be limited to (Pounds)74,000.
(f) The Principal Sellers' liability in respect of a claim made after
June 30, 1998 based on breach of the representations, warranties and covenants
contained in Section 2.11 or the Tax Deed shall be limited to the total amount
distributed to the Sellers from the Escrow Amount.
Section 5.03. Indemnification by Sellers. Subject to the limitations set
------------ --------------------------
forth in Section 5.02, to the extent applicable, the Principal Sellers hereby
jointly and severally indemnify and hold the Purchaser and its officers,
directors, employees, representatives and agents (each an "Indemnified Party")
-----------------
harmless from and against all claims, liabilities, obligations, costs, damages,
losses and expenses and all related costs and expenses (including legal fees and
expenses) and all costs of collection (collectively "Losses"), arising out of
------
(i) any breach of the representations, warranties, covenants or agreements of
the Sellers set forth herein; (ii) the current dispute between the Company and
the Xxxxxx Company regarding certain commissions allegedly owed the Xxxxxx
Company by the Company; (iii) the failure of the Company to sell in the ordinary
course any Inventory (as defined in Section 2.27), excluding Reclassified Fixed
Assets, within twelve months following the Closing Date and (iv) the failure of
the Company to collect 75% of the aggregate
35
amount of the Accounts Receivable reflected on the Closing Balance Sheet (net of
any reserve therefor on the Balance Sheet) on or before 90 days after the
Closing Date, and the remaining 25% on or before the first anniversary of the
Closing Date. For purposes of clause (iii) of the immediately preceding
sentence, the Loss associated with any item of Inventory not sold within the
prescribed period shall be deemed equal to the recorded value of such item on
the Closing Balance Sheet. For purposes of clause (iv) of the first sentence of
this Section 5.03, the Loss associated with any Account Receivable not collected
within the prescribed period shall be deemed equal to the full amount of such
Account Receivable. Subject to the limitations set forth in Section 5.02, to the
extent applicable, each of the Other Sellers hereby severally indemnifies and
holds the Indemnified Parties harmless from and against all Losses arising from
a breach of the representations and warranties made by such Other Seller in
Section 2.29. Except as provided in the immediately preceding sentence and
notwithstanding any other provision of this Agreement, the Other Sellers shall
have no liability under this Agreement.
Section 5.04. Procedure for Indemnification of Direct Claims. If any
------------ ----------------------------------------------
Indemnified Party becomes aware of any claim for indemnification (a "Claim"),
-----
other than in respect of third party claims, that it wishes to make against any
Seller, the Indemnified Party shall promptly give notice of such Claim to the
Seller or, if the Indemnified Party seeks recovery for such claim entirely from
the Escrow Amount, to the Individual Seller Representatives. Such notice shall
specify with reasonable particularity (to the extent that the information is
available) the factual basis for the Claim and the amount of the Claim, if
known. The person or persons to whom notice of a Claim is required to be given
under this Section 5.04 is herein referred to as the "Indemnifying Party."
------------------
The Indemnifying Party shall have 30 days from receipt of notice of the
Claim within which to make such investigation of the Claim as the Indemnifying
Party considers necessary or desirable. If the Indemnified Party and the
Indemnifying Party agree at or before the expiration of such 30-day period (or
any mutually agreed upon extension thereof) to the validity and amount of such
Claim, the Indemnifying Party shall immediately pay or, if the Individual Seller
Representatives are the Indemnifying Party, immediately cause to be paid from
the Escrow
36
Amount, to the Indemnified Party, the full agreed upon amount of the Claim,
failing which the matter shall be referred to binding arbitration pursuant to
Section 6.06 hereof.
Section 5.05. Procedures for Indemnification of Third Party Claims. An
------------ ----------------------------------------------------
Indemnified Party seeking indemnification hereunder with respect to a third
party claim will give the Indemnifying Party timely written notice of any legal
proceeding, claim or demand instituted by any third party (in each case, a
"Third Party Claim") in respect of which the Indemnified Party is entitled to
------------------
indemnification hereunder. Such notice shall specify with reasonable
particularity (to the extent that the information is available) the factual
basis for the Claim and the amount of the Third Party Claim, if known.
The Indemnifying Party shall have the right, by the giving notice to
the Indemnified Party within 90 days after receipt of notice from the
Indemnified Party of a Third Party Claim, stating that the Indemnifying Party is
responsible for such Third Party Claim, at the Indemnifying Party's expense, to
defend against, negotiate, settle or otherwise deal with any Third Party Claim
and to have the Indemnifying Party represented by counsel, reasonably
satisfactory to the Indemnified Party, selected by the Indemnifying Party. If
the Indemnifying Party has not given such notice to the Indemnified Party within
10 days after receipt of notice from the Indemnified Party of a Third Party
Claim, the Indemnified Party shall be entitled to defend against, negotiate,
settle or otherwise deal with any Third Party Claim until such time (not later
than 90 days after such notice) as notice is given pursuant to the preceding
sentence. If notice is given pursuant to the first sentence of this paragraph,
the Indemnifying Party, as a condition to being entitled to exercise its rights
under such sentence, shall reimburse the Indemnified Party for all costs and
expenses incurred by it with respect to such Third Party Claim prior to such
assumption by the Indemnifying Party. The Indemnified Party may participate in
any proceeding with counsel of its choice and at its expense. If the
Indemnifying Party, having elected to assume control of any Third Party Claim,
thereafter fails to defend the Third Party Claim within a reasonable time, the
Indemnified Party shall be entitled to assume such control and the Indemnifying
Party shall be bound by the results obtained by the Indemnified Party with
respect to such Third Party Claim.
37
The Indemnifying Party may not enter into a settlement of any Third
Party Claim without the consent of the Indemnified Party unless such settlement
requires no more than a monetary payment for which the Indemnified Party is
fully indemnified. If any proposed settlement requires more than a monetary
payment, the Indemnified Party will not unreasonably withhold its consent to any
such settlement.
The parties will cooperate fully with each other in connection with
the defense, negotiation or settlement of any Claim.
Section 5.06. Mitigation. The Purchaser will take all reasonable steps to
------------ ----------
mitigate any Loss suffered by it arising out of any breach of the
representations, warranties, covenants, or agreements of the Sellers set forth
herein.
Section 5.07. Purchase Price Adjustment. The satisfaction by the Sellers
------------ -------------------------
of any claim hereunder shall be deemed to be a corresponding reduction in the
consideration paid by the Purchaser for the Shares.
Section 5.08. Accounts Receivable Collection. The Purchaser covenants and
------------ ------------------------------
agrees to use commercially reasonable efforts to collect the Accounts
Receivable. "Commercially reasonable efforts to collect" as used herein shall
not be interpreted to require the Purchaser to initiate any legal proceedings
for the collection of Accounts Receivable or the defense of any claims by an
account debtor but shall be interpreted to include other past practices of the
Company utilized in the ordinary course of business in connection with the
collection of accounts receivable. If prior to the first anniversary of the
Closing Date the Purchaser collects an Account Receivable which was not
collected on or before 90 days after the Closing Date and which gave rise to a
previous recovery from the escrow established under the Escrow Agreement (as a
result of clause (iv) of the first sentence of Section 5.03 or a breach of the
representation contained in Section 2.17), the Purchaser shall remit to the
escrow the amount of such previous recovery from the escrow with respect
thereto, plus interest on any such amount not remitted to the escrow within ten
(10) days after collection of the related Account Receivable, such interest to
accrue, from and after such ten (10) days and until such amount is remitted to
escrow, at the Base Rate (as defined in Section
38
1.02(c)). In addition, if the Purchaser asserts a claim based on an uncollected
Account Receivable and recovers the amount of such claim from the escrow
established under the Escrow Agreement (and does not subsequently remit such
amount to the escrow in accordance with the immediately preceding sentence), the
Purchaser will transfer without recourse all of the Purchaser's rights in such
Account Receivable to the Sellers (but only to the extent of any previous
recovery from escrow with respect thereto which was not subsequently remitted to
the escrow) at the later of (i) the first anniversary of the Closing Date and
(ii) the time of such recovery from escrow.
Section 5.09. Sale of Slow-Moving Inventory. If in respect of a particular
------------ -----------------------------
item of Inventory the Purchaser recovers for an indemnity claim based on clause
(iii) of the first sentence of Section 5.03 and prior to the second anniversary
of the Closing Date the Purchaser sells such item of Inventory, the Purchaser
shall promptly remit the proceeds of such sale (but only to the extent of any
previous recovery from escrow with respect thereto) to the Sellers' Solicitor.
The Sellers' Solicitor shall distribute the amount so remitted to the Principal
Sellers pro rata based on the number of ordinary shares or class A ordinary
shares each holds at Closing and as shown on Exhibit A-I and Exhibit A-II
----------- ------------
relative to the total number of issued ordinary shares and class A ordinary
shares at Closing.
ARTICLE VI
MISCELLANEOUS
Section 6.01. Notices. Any notices or other communications required or
------------ -------
permitted to be given hereunder shall be sufficiently given if delivered in
person or mailed by registered or certified mail, return receipt requested,
addressed as follows:
To the Purchaser: Aseco Corporation
000 Xxxxxx Xxxxx Xxxxxxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
U.S.A.
Attention: President
39
with a copy to:
Xxxxxx X. Xxxxxxxx
Xxxxxx, Xxxx & Xxxxxxx
Exchange Place
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
X.X.X.
To the Sellers: at their respective addresses set forth on Exhibit A-I
-----------
or Exhibit A-II hereto.
-----------------------
with a copy to:
Xxxxx Xxxxx
Burges Salmon
Xxxxxx Xxxx Xxxxx
Xxxxxx Xxxx
Xxxxxxx XX0 0XX
England
Section 6.02. Expenses; Distribution of Proceeds of Purchase Price. All
------------ ----------------------------------------------------
legal and other costs and expenses incurred in connection with this Agreement
and the transactions contemplated hereby (the "Costs and Expenses") shall be
------------------
paid by the party incurring such Costs and Expenses, except as otherwise
provided herein. In particular, the Costs and Expenses of legal counsel,
accountants and other advisors, and any brokers, finders, investment bankers or
other similar intermediaries, to each party shall be borne by such party;
provided, however, that all Costs and Expenses incurred by the Company on behalf
-------- -------
of the Sellers shall be the liability of and shall be borne by the Principal
Sellers and the Principal Sellers hereby jointly and severally indemnify the
Company and the Purchaser therefor.
Section 6.03. Successors and Assigns; Amendments and Waivers. This
------------ ----------------------------------------------
Agreement shall be binding upon and shall inure to the benefit of the parties
and their respective successors and assigns, provided that neither this
Agreement nor any right hereunder may be assigned by any party without the
written consent of the Purchaser, the Individual Seller Representatives and the
Institutional Sellers, except that the Purchaser may assign its rights to
purchase the Shares prior to Closing to any
40
one or more of its subsidiaries and after the Closing the Purchaser or its
subsidiaries may assign its rights hereunder to any successor to all or any
substantial portion of its business, provided that the Purchaser shall remain
liable with respect to all of the Purchaser's obligations hereunder. This
Agreement may be modified or amended only by an agreement in writing signed by
the Purchaser, the Individual Seller Representatives and the Institutional
Sellers. No waiver of any term or provision hereof shall be effective unless in
writing signed by the party waiving such term or provision.
Section 6.04. Counterparts. This Agreement may be executed in two or more
------------ ------------
counterparts, and with counterpart signature pages, all of which taken together
shall constitute one and the same agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart.
Section 6.05. Headings. The headings of Articles, Sections, Exhibits and
------------ --------
Schedules herein are inserted for convenience of reference only and shall be
ignored in the construction or interpretation hereof.
Section 6.06. Governing Law; Dispute Resolution.
------------ ---------------------------------
(a) This Agreement and any amendment hereof and any waiver or consent
hereunder shall be governed by and interpreted and construed in accordance with
the law of England.
(b) The parties shall attempt to resolve any dispute under this
Agreement amicably by mutual agreement. Any such dispute which cannot be
resolved by agreement shall be finally resolved by arbitration in accordance
with the Rules of Conciliation and Arbitration of the International Chamber of
Commerce ("ICC") by three arbitrators. The Purchaser shall appoint one
---
arbitrator and the Individual Seller Representatives shall appoint one
arbitrator (the "Sellers' Arbitrator"); provided, however, that if the dispute
------------------- -------- -------
involves a claim by the Purchaser against any Seller with respect to which the
Purchaser is not seeking recovery exclusively from the Escrow Amount, then the
Sellers' Arbitrator must be approved by such Seller.
(c) The two arbitrators thus appointed shall appoint the third
arbitrator. If a party fails to appoint its arbitrator within a period of
fifteen (15) days after the other party has
41
appointed its arbitrator, or if the two arbitrators cannot agree on the third
arbitrator within a period of twenty (20) days after appointment of the second
arbitrator, then the arbitrator of the failing party and/or the third arbitrator
shall be appointed by the Court of Arbitration of the ICC. The place of
arbitration shall be London, England. The decision and award of the arbitral
tribunal shall be final and binding and shall be enforceable in any court of
competent jurisdiction in accordance with the United Nations Convention on the
Recognition and Enforcement of Foreign Arbitral Awards. In any action or
proceeding brought by a party to enforce this Agreement or any arbitral award
rendered pursuant thereto, the prevailing party shall be entitled to recover the
costs and expenses (including, but not limited to, legal fees and expenses)
incurred by the prevailing party in connection with that action or proceeding.
(d) Notwithstanding the foregoing provisions of this Section 6.06, any
dispute concerning Section 3.01 or 3.02 of this Agreement in which injunctive
relief is sought may be brought in any court having jurisdiction to hear and
resolve such dispute.
Section 6.07. No Waiver. No failure to exercise and no delay in
------------ ---------
exercising any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or remedy
hereunder preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. The rights provided are cumulative and not
exclusive of any rights provided by law.
Section 6.08. Integration. This Agreement, together with Exhibits and
------------ -----------
Schedules hereto, embodies the entire agreement and understanding between the
parties with respect to this transaction and supersedes all prior discussions,
understandings and agreements concerning the matters covered hereby.
Section 6.09. Limitation on Scope of Agreement. If any provision of this
------------ --------------------------------
Agreement is unenforceable or illegal, such provision shall be enforced to the
fullest extent permitted by law and the remainder of the Agreement shall remain
in full force and effect.
Section 6.10. Release. Effective as of the Closing, each Seller releases
------------ -------
the Company from any and all claims, liabilities, obligations, damages,
expenses, and other amounts of every kind
42
and description arising or existing prior to the Closing (each a "Seller
------
Claim"), or relating to the period prior thereto, other than liabilities and
-----
obligations disclosed in this Agreement or in any exhibit hereto in respect of
any ordinary course, market rate transactions between the Company and any
business of a Seller; provided, however, that this release shall not be
-------- -------
applicable to any Seller that is and will be immediately following the Closing a
director, officer or employee of the Company if the Seller Claim of such Seller
relates or arose out of such Seller's employment by the Company and is disclosed
in this Agreement.
Section 6.11. Further Assurances. Following the Closing, each Seller will
------------ ------------------
execute and deliver to the Purchaser such documents and take such other actions
and, so far as it is able, procure the passing of such resolutions as the
Purchaser may reasonably request in order to complete or effect the transactions
contemplated hereby.
Section 6.12. No Third Party Beneficiaries. Nothing contained in this
------------ ----------------------------
Agreement shall create any rights in or for the benefit of any third party that
is not a party hereto.
Section 6.13. Interpretation. (a) Reference in this Agreement to the
------------ --------------
singular includes a reference to the plural and vice versa and reference to the
masculine includes a reference to the feminine and neuter and reference to a
person shall include a reference to any company as well as any legal or natural
person.
(b) Reference in this Agreement to any statutory provision shall
include a reference to that provision as amended, extended or re-enacted and to
any statutory replacement thereof (either before or after the date hereof) from
time to time and to any former statutory provisions replaced (with or without
modification) by the provisions referred to, and shall also include reference to
all statutory instruments and orders made pursuant to any statutory provisions.
(c) The expression "subsidiary" bears the same meaning in this
agreement as in the Company Xxx 0000.
(d) Any reference herein to the Company shall be deemed to include
each of its subsidiaries unless the context does not so permit.
43
Section 6.14. Schedules. At the option of the Sellers, each reference
------------ ---------
herein to a Schedule hereto or to a Schedule to be delivered in connection
herewith may be delivered on the date hereof as a Disclosure Letter by the
Sellers' Solicitor on behalf of the Sellers in form and substance satisfactory
to the Purchaser and, if so provided in such manner, shall for all purposes be
deemed to be a part of this Agreement to the same extent as if such Schedules
were attached hereto. In any event, any matter disclosed in any Schedule hereto
or in such Disclosure Letter shall, for all purposes, qualify the
representation(s) and warranty(ies) to which such matter corresponds.
Section 6.15. Rescission. Except in the case of fraud or willful
------------ ----------
misconduct and subject to the terms of Section 1.01(d) hereof, no party hereto
shall have the right to rescind or repudiate this Agreement.
Section 6.16. No Implied Warranties. The parties acknowledge and agree
------------ ---------------------
that, subject to the terms of Section 1.01 hereof, there are no representations,
warranties, terms, or conditions (express or implied) among the parties
concerning the matters contemplated hereby other than as expressly set forth
herein and in each other agreement, document and instrument delivered in
connection herewith.
Section 6.17. Power of Attorney. Each Individual Seller, hereby grants to
------------ -----------------
Purchaser (i) an irrevocable power of attorney appointing the Purchaser to be
such Individual Seller's lawful attorney for the purpose of receiving notices of
and attending and voting at all meetings of the members of the Company in
respect to the Shares to be transferred by such Individual Seller hereunder from
the date of Closing to the day on which the Purchaser or its nominee is entered
in the register of members of the Company as the holder of such Shares and (ii)
an irrevocable authority authorizing:
(A) the Company to send any notices in respect of such Shares to
the Purchaser during such period; and
(B) the Purchaser to complete in such manner as it thinks fit and
to return proxy cards, consents to short notice and any other
documents required to be signed by the registered holder of
44
such Shares during such period.
Each Institutional Seller agrees to vote of its Shares in accordance with the
Purchaser's instructions.
Section 6.18. Post-Closing Board Meeting. The Sellers shall procure that
------------ --------------------------
a meeting of the board of directors of the Company and (if requested by the
Purchaser) each of its subsidiaries is properly convened and held immediately
after the Closing and that at such meeting the directors:
(i) duly appoint as additional directors such persons as the
Purchaser shall nominate;
(ii) approve the registration of the transfers of the Shares
hereunder (subject to their being duly stamped);
(iii) conduct such other business as the Purchaser may reasonably
require; and
(iv) cause the chairman of such meeting to sign the minutes
thereof in agreed form.
IN WITNESS WHEREOF, this Agreement has been executed and delivered as of
the day and year first above written.
PURCHASER:
---------
ASECO CORPORATION
By: /s/ Xxxx X. Xxxxxx, Xx.
------------------------
Name:
Title:
SELLERS:
-------
3i GROUP PLC
45
By: /s/ Xxxxxxxx Xxxxxxx
--------------------
Name:
Title:
TRANSATLANTIC TRUST CORPORATION
By: /s/ Xxxxxx Xxxxx
--------------------
Name:
Title:
/s/ Xxxxxx Xxxxx
--------------------------
Xxxxxx Xxxxx
/s/ Xxx Xxxxxxx
---------------------------
Xxx Xxxxxxx
/s/ Xxxxxx Xxxxxx
--------------------------
Xxxxxx Xxxxxx
GRAN NOMINEES LTD.
By: /s/ Xxxxx Xxxxxxx
--------------------
Name:
Title:
/s/ Xxxxxxx Xxxxxx
--------------------------
Xxxxxxx Xxxxxx
DEVON ENTERPRISE FUND
By: /s/ Xxxxx Xxxxxxx
--------------------
Name:
Title:
46
/s/ Xxxxxx Xxxxxx
_________________________
Xxxxxx Xxxxxx
/s/ Xxxxx Xxx
_________________________
Xxxxx Xxx
/s/ Xxxxx Xxxxx
_________________________
Xxxxx Xxxxx
/s/ Xxxx Xxxx
_________________________
Xxxx Xxxx
/s/ Xxxx Xxxxxx
_________________________
Xxxx Xxxxxx
/s/ Xxxxxx Xxxx
_________________________
Xxxxxx Xxxx
/s/ Xxx Xxxxxxx
_________________________
Xxx Xxxxxxx
/s/ X. Xxxxxx
_________________________
X. Xxxxxx
/s/ Xxxxxx Xxxxxx
_________________________
Xxxxxx Xxxxxx
/s/ Xxxxxxx Xxxxxx
_________________________
Xxxxxxx Xxxxxx
/s/ Xxxxxxx Xxxxxxxxx
_________________________
Xxxxxxx Xxxxxxxxx
47
/s/ Xxxxxxx Xxxxxx
_________________________
Xxxxxxx Xxxxxx
/s/ Xxxxxx Xxxx
_________________________
Xxxxxx Xxxx
/s/ Xxxx XxXxxxxxx
_________________________
Xxxx XxXxxxxxx
/s/ Xxxxxxxxxxx Xxxxxxx
_________________________
Xxxxxxxxxxx Xxxxxxx
/s/ Xxxxxxx Xxxx
_________________________
Xxxxxxx Xxxx
For purposes of Section 3.02 only:
/s/ Xxxxx Xxxx
_________________________
Xxxxx Xxxx
48
EXHIBITS & SCHEDULES
--------------------
Exhibit A-I Principal Sellers
Exhibit A-II Other Sellers
Exhibit 4.01(e) Form of Escrow Agreement
Schedule 1.02 Wire transfer instructions for Sellers' Solicitor
Schedule 2.01 Memorandum and Articles of Association of the Company
and each subsidiary
Schedule 2.03 Subsidiaries
Schedule 2.05 Capitalization
Schedule 2.06 Financial Statements
Schedule 2.07 Material Adverse Changes
Schedule 2.08 Material Contracts
Schedule 2.09 Real Property Leases
Schedule 2.10 Personal Property
Schedule 2.11 Tax Matters
Schedule 2.12 Required Consents
Schedule 2.13 Licenses and Permits
Schedule 2.14 Pensions
Schedule 2.15 Employment and Severance Agreements
Schedule 2.16 Intellectual Property
Schedule 2.18 Regulatory and Legal Compliance
Schedule 2.19 Insurance
Schedule 2.20 Litigation
Schedule 2.21 Proprietary Information of Third Parties
Schedule 2.25 Banking Relations; Powers of Attorney
Schedule 2.26 Warranty Claims
Schedule 3.02 Seller Directors
Schedule 4.01(d) Consents Required for Closing
49
EXHIBIT A-I
TO SHARE PURCHASE AGREEMENT
---------------------------
NAME AND ADDRESS OF NUMBER OF SHARE TYPE PORTION OF INITIAL
SHAREHOLDER SHARES HELD AMOUNT ((Pounds))
Transatlantic Trust
Corporation 227358 Ordinary
X. Xxxx No. 3 Settlement 1,163,600.
X.X. Xxx 000 85
6/7 Mulcaster Street
St. Helier, Jersey
Xxxxxxx Xxxxxxx,
XX0 0XX Xxxxxxx
Xxxxxx Xxxxx 42164 Ordinary 215,792.15
00 Xxxxxxxx Xxxx Xxxx
Xxxxxxx, Xxxxxxxx
XX0 ODB England
Xxx Xxxxxxx 00000 Xxxxxxxx
Xxxxxxxxx
00 Xxxxxx Xxxx 0000 Xxxxxxxx 211,493.06
Winscombe (after
North Somerset exercise of
XX0 0XX Xxxxxxx options)
Xxxxxx Xxxxxx 24614 Ordinary
00000 Xxxxxxx Xxxxx Xxxxx
Xxxxxxx, XX 00000 2718 Ordinary 139,883.13
USA (after
exercise of
options)
Xxxxxxx Xxxxxx 11118 Ordinary
00 Xxxxx Xxxx
Xxxxxxxxx 0000 Xxxxxxxx 81,436.45
Pymouth (after
Devon, England exercise of
options)
Xxxxxx Xxxxxx 5000 Ordinary
8 Feversham Close (after
Plympton exercise of
Plymouth options)
Xxxxx
XX0 0XX England 2500 Ordinary 38,384.48
Xxxxx Xxx 0000 Xxxxxxxx 15,353.82
Bentfield House (after
Stansted Mountfitchet exercise of
Essex options)
XX00 0XX Xxxxxxx
00
Xxxxx Xxxxx 0000 Xxxxxxxx 12,794.86
29 The Fort (after
Cawsand exercise of
Cornwall options)
England
Xxxx Xxxx 2000 Ordinary 10,235.90
00 Xxxxxxxx Xxxxxx (after
Xxxxxx exercise of
Plymouth options)
XX0 0XX England
Xxxx Xxxxxx 2000 Ordinary 10,235.90
Quarry View (after
Station Road exercise of
Loddiswell options)
Xxxxxxxxxxx
Xxxxx
XX0 0XX Xxxxxxx
Xxxxxx Xxxx 1500 Ordinary 7,676.44
Moorlands (after
Xxxxxxxx Cross exercise of
Liverton options)
Xxxxxx Xxxxx
Xxxxx
XX00 0XX Xxxxxxx
Xxx Xxxxxxx 1500 Ordinary 7,676.94
0 Xxxxxx Xxx (xxxxx
Xxxxxxxx, Xxxxxxxxxxxxx exercise of
01886 options)
USA
X. Xxxxxx 1000 Ordinary 5,117.97
0000 Xxxxx Xxxx (after
No. 14 exercise of
Xxx Xxxx, Xxxxxxxxxx 00000 options)
USA
51
Xxxxxxx Xxxxxxxxx 500 Ordinary 2,559.01
0 Xxxxxxxxx Xxxx (after
Old Ferry Road exercise of
Saltash options)
Cornwall
PL12 4EH England
52
EXHIBIT A-II
TO SHARE PURCHASE AGREEMENT
---------------------------
NAME AND ADDRESS OF SHAREHOLDER NUMBER OF SHARES HELD SHARE TYPE PORTION OF INITIAL AMOUNT ((Pounds))
3i Group PLC 425000 Preference 459,192.00
00 Xxxxx Xxxxxx
Xxxxxxx
Xxxxxxx
0x Group PLC 75000 A Ordinary 503,655.81
00 Xxxxx Xxxxxx
Xxxxxxx
Xxxxxxx
Gran Nominees Ltd 00000 Xxxxxxxx 100,361.80
Xxxx Xxxxx
00 Xxxxxxx Xxxxxx
Xxxxxx
X00 XX Xxxxxxx
Devon Enterprise Fund 6011 Ordinary 40,366.36
Xxxxxx Xxxx
Xxxxxxx Xxxx
Xxxxxx
Xxxxx
Xxxxxxx
Xxxxxx Xxxxxx 555 Ordinary 3,726.95
c/o The Ravenscroft Nursing Home
Xxxxxxxxxxx
Xx. Xxxxxxxxx
Xxxxx
England
Xxxxxxx Xxxxxx 505 Ordinary 3,391.38
00 Xxxxxxxxx Xxx
Xxxxxxxxx Xxxxx
Xxxx
Xxxxxxx
Xxxxxxx Xxxxxx 481 Ordinary 3,230.11
The Chantry
Ivybridge
Devon
England
Xxxxxx Xxxx 193 Ordinary 1,296.18
00 Xxxxxxxx Xxxx
Xxxxxxxxx
Xxxxxxxx
XX0 0XX England
Xxxx XxxXxxxxxx 179 Ordinary 1,202.03
00 Xxxxxxxx Xxxxx
Xxxxxxxx
Xxxxx
XX0 0XX England
Xxxxxxxxxxx Xxxxxxx 104 Ordinary 698.50
"Skiarry"
Loch Hourn
Inverness
Scotland
Xxxxxxx Xxxx 95 Ordinary 638.07
"Trevella"
Xxxxxxxxxxx Xxx
XXXXXXX
Xxxxxxxx
XX00 0XX Xxxxxxx
53
